Crowdsourcing & Outsourcing. What’s the difference?

As crowdsourcing becomes more and more popular trend among IT community and some people can’t find difference between crowdsourcing and outsourcing, it is important to separate these two concepts. There are six major distinctions.

1. Pay for hour / Pay for output.

Outsourcing – maybe the main weak spot of that concept is that you pay for hours. So, no matter what is the final output (is it satisfactory or not), or if there are some huge delays, you will pay all of it.

Crowdsourcing – here the quality of the output is the must, so the competition is the main driver for production and you will pay only for the result that comply with your needs. It also means that your spendings become more predictable. The most advanced approach here is a hybrid model – when you ‘buy’ a specific amount of hours for crowdsourced professionals. In this way your expectations will be in a total compliance with the results you get.

2. Unforced errors and delays.

Outsourcing - it means that a group of developers and testers is working on your project. Externally. However, they are humans and work as usually, so the room for errors is still exists.

Crowdsourcing – by following TopCoder’s Competition Methodology, you can drastically increase the quality of the final output. Here you have a community of developers and testers driven by competition and each one works on their own solution. Finally, the best in breed is selected, which complies with all the predefined requirements.

3. When the quantity makes sense.

Outsourcing – usually you need to search a specific outsourcing company that fits for you new project and if not, your searches can be a little bit longer than expected. Sometimes it is not acceptable.

Crowdsourcing – this is a community that grows every single day, so you don’t have to worry that your project can’t be completed in time because current developers or testers lack of required skills.

4. Predictability.

Outsourcing – outsourcing has a labour-based model where the output depends on human succeeding in direct proportion. However, as the time shows, there are always additional costs and delays, which affect the quality of the output.

Crowdsourcing – every project is divided on certain simple aspects, so it is very easy to predict all the tender spots and maintain high quality of the output. Competition-based model also addresses the challenges related to the quality. As a result, more predictability leads to more successful projects.

5. The scope of work.

Outsourcing – a finite pool and related limitations may be a reason why some projects are not as successful as they can be.

Crowdsourcing – it provides approximately 40 different types of competitions, contests and challenges, so your project will receive the output with the highest possible quality no matter how specific your project is.

6. A way to success.

Outsourcing – it is simple: you pay for what you are expected to receive. So, there is insignificant chance to achieve something new.

Crowdsourcing – due to a deeper “investigation” of your project developers and testers can generate new ideas, concepts and thoughts. This is more efficient, faster, much less costly and problematic way to give your projects a boost to the future and further innovations.